Process too complex and ambiguous, critics say.
Only one in three Albertans with disabilities are benefiting from the federal disability tax credit, according to a report from the University of Calgary’s School of Public Policy.
By Sarah Rieger, CBC News Calgary January 11, 2018
People with disabilities often face hidden (or non-itemizable) costs, and barriers that can lead to lower income and employment rates.
The tax credit is designed to support persons with disabilities by reducing the amount of income tax they have to pay, and it also opens the door for other benefits like the registered disability savings plan, the working income tax benefit and the child disability benefit.
Jeannie Stewart has gone through the process of applying for the tax credit as both an individual and parent.
“I’m well versed in fighting for this tax credit,” Stewart told CBC News.
The first time she applied for the credit as an adult, she was denied. When she contacted the Canada Revenue Agency to appeal, she said they suggested that because she’s had a disability her entire life, she should have adapted to it.
“They thought my arm was going to grow back, I guess?” she joked.
She spent five years appealing the decision before it was accepted.
In Alberta, 36,632 people between the ages of 18 and 59 were eligible for the disability tax credit in 2014. Only an estimated 36.9 per cent of those people received the tax credit that year, one of the lowest rates of uptake across Canada.
‘Unacceptably low’ rate
Jennifer Zwicker, one of the authors of the university’s report, says the process needs to be more transparent and eligibility criteria needs to be more broad to improve what the report describes as an “unacceptably low” rate.
“Some of the barriers are, in some cases, awareness. Families are not aware they can claim the tax credit or they can transfer it to caregivers. [Also] the application process is very complex and difficult for family members and health care practitioners to navigate,” Zwicker said.
Canadians with disabilities have been voicing their frustrations with the disability tax credit system in recent months, after reports that Type 1 diabetics were being denied for the credit, despite claims that their applications met the somewhat restrictive eligibility criteria.
In response to the concerns, the government announced plans to set up a disability advisory committee.
“Improvements are needed for making sure the process is transparent, the appeals process is transparent, there is eligibility criteria in place reflecting the realities of activities of daily living,” Zwicker said.
Stewart hopes the committee will make the application process less ambiguous.
Right now, one of the questions asks if applicants are able to get dressed by themselves; they have the option of checking ‘yes’ or ‘no.’
Stewart says that while she can get dressed in the morning, the question doesn’t reflect how long it can take her to get ready with one arm — “five minutes to button my pants” — or how much longer it takes her throughout the day to do different tasks.
She also points to the complexity of the application process as a barrier, especially for those with cognitive disabilities.
The application not only involves answering a questionnaire that lacks “clarity,” according to the U of C’s report, but it also requires applicants to find and pay a health care professional to fill out a portion of the form.
“It would be nice if some kind of program were in place to help an individual navigate this process and go through these forms.”
Other provinces that have programs in place to help people apply have higher rates of take-up, Zwicker said.
‘I kept fighting and fighting’
Zwicker suggests people still apply for the credit, despite the onerous process, especially as tax season approaches.
And Stewart has some advice for those wading through the paperwork to apply.
“Send everything you can, impact letters as a parent, impact letters as a person, photos,” Stewart said.
She’s even sent in photos of her arm as a supporting document, to make sure her application is approved.
“I kept fighting and fighting and fighting.”
Source CBC News
The Disability Tax Credit: Why it Fails and How to Fix it, Wayne Simpson, Harvey L. Stevens. SPP Research Papers, Vol. 9, Iss. 24, June 2016. doi: /10.11575/sppp.v9i0.4259 PDF
The CRA makes it so hard to get the disability tax credit, many don’t even try in Global News – New Brunswick
Breaking down barriers to the disability tax credit in Policy Option Politiques
Ottawa accused of new tax grab after disability tax credit clawback hits those with mental illness in The Financial Post